On February 7, the Geneva Public Prosecutor’s Office in Switzerland announced that it had decided to close its criminal investigation of Equatorial Guinea Vice President Teodorin Obiang and two other individuals, after reaching agreement with the defendants on the sequestration of 25 of Obiang’s luxury cars and the release of Obiang’s $100 million yacht.

The announcement (French only) stated that the Public Prosecutor’s Office had begun a criminal investigation of Obiang and two others in October 2016 for money laundering (Swiss Penal Code §305bis1) and misconduct in public office (Swiss Penal Code §314). Shortly thereafter, Swiss authorities seized 11 high-performance luxury cars (reportedly including a Bugatti Veyron, several Ferraris, and a Koenigsegg), and ultimately seized a total of 25 cars belonging to Obiang. In addition, at the request of Swiss authorities, Dutch authorities sequestered Obiang’s yacht, Ebony Shine, pursuant to a letter rogatory. The subsequent pursuit of the investigation, according to the Public Prosecutor’s Office, “required the conduct of sending of letters rogatory to the United States, the Cayman Islands, France, the Netherlands, the Marshall Islands, Monaco, and Denmark.”

Under the terms of the resolution with the Public Prosecutor’s Office, the defendants agreed to the following actions:

Confiscation and sale of the 25 cars, with the proceeds of the sale “intended to be earmarked for a social program in the territory of Equatorial Guinea for the people of that country. The program is to be carried out in a transparent manner on the basis of an international agreement to be negotiated by the [Swiss] Federal Department of Foreign Affairs.”

Payment of CHF 1.3 million to the Canton of Geneva, particularly to cover the cost of the proceedings.

In return, the Public Prosecutor’s Office decided to close the proceeding and to lift the sequestration of the yacht. The announcement explained that this action is based on article 53 of the Swiss Penal Code, “which provides that the Public Prosecutor may close the proceeding when the defendant has repaired the damage or has made all the efforts that one could expect of him to compensate for the harm that he has caused and restore a situation in conformity with the law.”

Note: The Public Prosecutor’s announcement is of interest largely because it closes a chapter in the continuing saga of international efforts to hold Obiang accountable for his role in the massive corruption that has plagued Equatorial Guinea for decades. The next significant chapter is likely to be the judicial response to Obiang’s challenge to his 2017 conviction in France.

In an article entitled, “Swiss Prosecutors Squander Opportunity to Counter Kleptocracy,” a Human Rights Watch staff member immediately criticized the Public Prosecutor’s decision. She wrote that the case “presented a rare opportunity to puncture the absolute impunity for corruption Teodorin enjoys at home, while returning some of his vast sums of money to the people to whom it belongs. . . . Instead, [the Swiss prosecutors] settled for crumbs, while allowing Teodorin to keep the pie.”

It is more likely that the Public Prosecutor’s Office, after more than two years of investigation and gathering evidence from at least seven other jurisdictions relating to Obiang’s finances and ownership of the yacht, found that it had insufficient evidence to charge and convict Obiang on money laundering and misconduct in public office. Not all criminal investigations, despite the best efforts of investigators and prosecutors, are guaranteed to produce convictions and lengthy prison sentences. In this case, the Geneva prosecutors may simply have concluded that they had too weak a hand to play, and reluctantly chose to walk away from the table with the winnings they had.

Human Rights Watch also opined that “[a]t the very least, Switzerland should ensure the proceeds from selling the cars go to programs that promote transparency in Equatorial Guinea and help civil society hold their officials accountable for corruption.” That is certainly a worthwhile and noble objective for the Swiss Department of Foreign Affairs. Sadly, the likelihood of achieving that objective is nonexistent in a country in which most residents, as the Guardianstated,

remain in crushing poverty, with little or no access to decent healthcare or education [and o]pposition to the status quo . . . is virtually non-existent: torture and intimidation of the government’s critics is common place, while any attempts to organise outside official government channels are crushed.

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Published by Jonathan J. Rusch

I'm a lawyer and consultant interested in corporate- and individual-compliance issues, and an inveterate part-time law professor; a former federal prosecutor, regulator, and anti-bribery and corruption compliance head at a global financial institution; and a (very minor) shareholder in Williams Grand Prix Engineering.
View all posts by Jonathan J. Rusch